Flame retardant fabric_Flame retardant fabric_Cotton flame retardant fabric_Flame retardant fabric information platform Flame-retardant Fabric News Seize the pricing power! 8 countries joined forces to collectively reduce production significantly, helping crude oil return to high levels

Seize the pricing power! 8 countries joined forces to collectively reduce production significantly, helping crude oil return to high levels

Crude oil revived? The eight major crude oil countries have taken obvious actions to reduce production, and crude oil has risen rapidly. Is there hope for the revival of the &#8220…

Crude oil revived?

The eight major crude oil countries have taken obvious actions to reduce production, and crude oil has risen rapidly. Is there hope for the revival of the “Silver Four” in the chemical market?

Seize the pricing power! 8 major countries collectively reduce production and push prices together!

Since April, the chemical energy list has increased significantly. Among the main energy products, only methanol and liquefied natural gas were in decline, while crude oil products in July were both in increase. Among them, WTI crude oil and Brent crude oil both achieved gains of over 8% in the first week of April.

*Source: Guanghua Trading

Since the beginning of the war between Russia and Ukraine, the crude oil market has been in a state of turmoil, with sharp rises and falls becoming a daily routine. Why did crude oil suddenly rise this time?

It is understood that since April, OPEC+ major producing countries have unexpectedly unanimously carried out collective voluntary production cuts after announcing an agreement to reduce production. OPEC+ members voluntarily cut production by an additional 1.157 million barrels per day, of which Russia and Saudi Arabia reduced production by 500,000 barrels per day, Iraq reduced production by 212,000 barrels per day, the United Arab Emirates reduced production by 144,000 barrels per day, Kuwait reduced production by 128,000 barrels per day, and Kazakhstan Production was reduced by 78,000 barrels per day, Algeria’s production was reduced by 48,000 barrels per day, and Oman’s production was reduced by 40,000 barrels per day. So far, the total production reduction of the alliance of oil-producing countries has reached 3.66 million barrels per day, equivalent to 3.7% of total global demand.

The eight major countries have a tacit agreement to join forces to collectively reduce production, which may be an attempt to inhibit the United States from controlling crude oil prices and compete for crude oil pricing power. At present, global demand is weak and the United States continues to raise interest rates due to the economic crisis and continues to destock crude oil, resulting in continued downturn in crude oil. Overcapacity and destocking continue to cause concerns among OPEC+ members. In order to curb the risk of low crude oil futures prices caused by the United States, reduce Due to excess supply of crude oil, OPEC+ adopted significant production cuts to balance crude oil production, stabilize prices and regain more control over prices.

Cutting production and then cutting production has pushed up crude oil prices, with the highest single-day increase exceeding 6%! The sharp reduction in crude oil production will benefit the downstream chemical market.

Coal prices have been weak recently, and the trend of coal chemical products has been under pressure. Ethylene glycol was among the largest decliners yesterday afternoon and remained weak today, closing at 4,067 yuan, down 1.83%. The weakening cost side has a greater impact on short fiber prices, which fell 2.57% today.

The trend of the ethylene glycol spot market was affected by the trend of crude oil, and there was a certain upward trend. The expected supply shortage after OPEC voluntarily cut production has made the crude oil market situation stronger again. However, oil prices did not rise further, still affected by economic uncertainty and potential risks on the demand side. However, judging from the increase in EG, it clearly lags behind that of chemical commodities. The main reason is that the supply and demand structure of ethylene glycol is still negative.

The increase in the domestic EG supply side is clear. Hainan Refining and Chemical has stabilized production. In the later stage, many units such as Guangxi Huayi, China Salt Red Sifang, Yangmei Shouyang, and Yongcheng Yongjin have plans to restart. However, there are still several new units in the country. The device is to be put into production. However, in the short term, the operating rate of domestic production has dropped significantly, but domestic production is still at a relatively high level. Judging from the source of imported goods, normal supply has been maintained in the near future.

On the demand side, with the recent surge in raw materials, polyester cash flow losses have increased. On the demand side, polyester factories have been affected by the surge in raw materials, increasing cost pressure, and the benefits of both polyester staple and filament yarns have been significantly compressed. And it is difficult to transmit downstream, and there is an intention to reduce production.

As of April 6, the total inventory of MEG ports in the main port area of ​​East China was 1.0567 million tons, an increase of 23,200 tons from the previous statistical period. The overall terminal situation is not good, polyester is mainly purchased for rigid needs, the pace of port shipments has been average recently, and the overall inventory is accumulated.

In terms of short fiber, the demand is weak, and the downstream lacks enthusiasm for purchasing raw materials that continue to rise. The actual orders are more in favor of rigid demand. Towards the weekend, cost support fell sharply, coupled with weak downstream follow-up, the supply of high-priced short fiber goods fell accordingly.

Longzhong Information reminds that in the medium and long term, the main focus is on whether the production reduction efforts of polyester factories will expand due to continued losses, as well as the negative feedback brought to the market by terminal demand.

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Author: clsrich